November 18, 2020

Alliance Members and Sponsors,

The Postal Regulatory Commission today approved rate increases for Market Dominant Mail classes as proposed by the USPS on October 9.  The new rates will be in effect on January 24, 2021.  As we know, regulatory approval involves checking the price cap calculations, ensuring the requirements, objectives, and factors in the law are followed, and verifying the workshare discount requirements:

The Commission concludes that the planned price adjustments do not violate the price cap limitations specified by 39 U.S.C. § 3622(d) and are consistent with, or justified by an exception to, the workshare discount limitations appearing in 39U.S.C. § 3622(e). The planned price adjustments are consistent with the pricing requirements appearing in 39U.S.C. § 3626 and do not implicate the pricing requirements appearing in 39 U.S.C. §§ 3627 and 3629. The planned price adjustments are consistent with the objectives of 39 U.S.C. §3622(b) and the factors of 39 U.S.C. §3622(c). The Commission also concludes that the planned classification changes, with the revisions set forth in the body of this Order, are consistent with applicable law and regulations.

The full order is here: https://www.prc.gov/docs/115/115120/Order%20No.%205757.pdf

The most important requirement in the law passed by Congress in 2006 is the one we are defending from the PRC’s attempt to unlawfully circumvent the will of Congress, to wit, the CPI price cap:

(d) Requirements.-

(1) In general.-The system for regulating rates and classes for market-dominant products shall-

(A) include an annual limitation on the percentage changes in rates to be set by the Postal Regulatory Commission that will be equal to the change in the Consumer Price Index for All Urban Consumers unadjusted for seasonal variation over the most recent available 12-month period preceding the date the Postal Service files notice of its intention to increase rates;

(B) establish a schedule whereby rates, when necessary and appropriate, would change at regular intervals by predictable amounts;

(C) not later than 45 days before the implementation of any adjustment in rates under this section, including adjustments made under subsection (c)(10)-

(i) require the Postal Service to provide public notice of the adjustment;

(ii) provide an opportunity for review by the Postal Regulatory Commission;

(iii) provide for the Postal Regulatory Commission to notify the Postal Service of any noncompliance of the adjustment with the limitation under subparagraph (A); and

(iv) require the Postal Service to respond to the notice provided under clause

(iii) and describe the actions to be taken to comply with the limitation under subparagraph (A);

Percentage Increases and Total Unused Price Authority (By Class)

Class of Mail               Price Changes%                Total Unused Price Authority%

First-Class Mail                    1.831                                     0.012

USPS Marketing Mail         1.509                                     0.010

Periodicals                           1.456                                     0.002

Package Services                1.460                                     0.006

Special Services                  1.458                                     0.007

Please let me know if you have questions.

Best, Steve

Best,

Stephen Kearney

executive director

Alliance of Nonprofit Mailers

1211 Connecticut Ave, NW, Suite 610

Washington, DC 20036

Tel: 202-462-5132

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